Online Gambling Gets a Tax Break Thanks to the European Union

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Online Gambling Gets a Tax Break Thanks to the European UnionAs of September 29, 2014, the Court of Justice of the European Union (CJEU) has ruled in favor of differentiated tax rates for online gambling. This differentiated tax rate would remain at 15% for all European online gambling sites.

For the European gambling market, this is a big change. Additionally, according to cardschat, “its far-reaching implications for the online gambling industry are actually quite substantial.”

The reason this ruling came into effect stems from a ruling by the Danish government. As the report explains, “The CJEU was asked to examine a challenge by various land-based licensees who were unsatisfied with the decision by the Danish government to levy one rate of taxes for brick-and-mortar operators and another for their online counterparts. This was as part of its liberalization and regulation of remote gaming, a regime that was implemented in January 2012. Taxing online gambling sites at a lower rate is fairly normal practice in the parts of Europe where gambling is legal and regulated, and is designed to channel customers to licensed operators.”

Online gambling providers were, as a result, very happy with this decision. Especially because the biggest concern was people jumping to illegal gambling sites, and thus the possibility of bringing the legalized European online gambling market down.

Brick and mortar casinos, however, did not receive the same kind of blessing from the CJEU. According to cardschat, “their land-based counterparts have to contend with up to a whopping 75 percent levy, the land-based licensees are not individually impacted by the tax regime because they would be taxed at the same rate whether online gambling was regulated in Denmark or not.”

One of the biggest concerns they hold with this decision now, are the 250,000 European citizens that are employed at various casinos, and if this will affect them.

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